Foot Locker Nabs Another Street Beat In Q3

Foot Locker Inc.’s share price continues to climb — up more than 7 percent at press time — after the retail giant posted yet another robust quarter.

The New York-based specialty-athletic retailer surpassed forecasts in the third quarter, with adjusted diluted earnings per share of $1.00, analysts predicted EPS of 95 cents, and revenue totaling $1.8 billion.

“It’s a tough retail environment out there — we hear that all the time. But in my experience, retail is a challenging game even the best of times,” Foot Locker CEO Dick Johnson said during the firm’s Q3 conference call. “But by focusing on the customer, creating exciting places to shop and buy, investing in our people and processes, living by our core values, and partnering with the best in the world, we have a very real chance of continuing to have a lot of happy customers and to win every day.”

CFO Lauren Peters noted that comps and traffic at its Footaction banner were negatively impacted by temporary store closures at several locations due to its remodeling initiatives while sales in the U.S. markets were stifled by declining tourism.

“The story with traffic this quarter was the same as last quarter, with a modest decline in U.S. traffic offsetting strong traffic trends internationally, producing the small overall increase in traffic,” Peters said during the conference call. “As mentioned in Q2, we believe that the different traffic patterns here and abroad relate to the significantly stronger dollar this year, which has led, in particular, to less tourist traffic in the U.S.”

Net Income: Reported net income for the company’s third quarter, ended Oct. 31, 2015, was $80 million, a 33 percent decline from the comparable quarter’s reported income of $120 million.

“Foot Locker remains Citi’s top pick for the holidays … While Q4 represents Foot Locker’s toughest comparison of the year, with retail comps up 10.2 percent last year, we continue to believe the company is well positioned going into holiday on a fresh, exciting product assortment and cleaner inventories versus the broader industry.” — Citi Research analyst Kate McShane